Mr. Vice President, Mr. Speaker, Members of the Senate and the House
of Representatives:

I wish each and every one of you a very happy New Year.

As the Congress reassembles, the impact of war abroad makes it natural
to approach "the state of the union" through a discussion of foreign affairs.

But it is important that those who hear and read this message should
in no way confuse that approach with any thought that our Government is
abandoning, or even overlooking, the great significance of its domestic
policies.

The social and economic forces which have been mismanaged abroad until
they have resulted in revolution, dictatorship and war are the same as
those which we here are struggling to adjust peacefully at home.

You are well aware that dictatorships—and the philosophy of force that
justifies and accompanies dictatorships—have originated in almost every
case in the necessity for drastic action to improve internal conditions
in places where democratic action for one reason or another has failed
to respond to modern needs and modern demands.

It was with far-sighted wisdom that the framers of our Constitution
brought together in one magnificent phrase three great concepts—"common
defense," "general welfare" and "domestic tranquility."

More than a century and a half later we, who are here today, still believe
with them that our best defense is the promotion of our general welfare
and domestic tranquillity.

In previous messages to the Congress I have repeatedly warned that,
whether we like it or not, the daily lives of American citizens will, of
necessity, feel the shock of events on other continents. This is no longer
mere theory; because it has been definitely proved to us by the facts of
yesterday and today.

To say that the domestic well-being of one hundred and thirty million
Americans is deeply affected by the well-being or the ill-being of the
populations of other nations is only to recognize in world affairs the
truth that we all accept in home affairs.

If in any local unit-a city, county, State or region—low standards of
living are permitted to continue, the level of the civilization of the
entire nation will be pulled downward.

The identical principle extends to the rest of the civilized world.
But there are those who wishfully insist, in innocence or ignorance or
both, that the United States of America as a self-contained unit can live
happily and prosperously, its future secure, inside a high wall of isolation
while, outside, the rest of Civilization and the commerce and culture of
mankind are shattered.

I can understand the feelings of those who warn the nation that they
will never again consent to the sending of American youth to fight on the
soil of Europe. But, as I remember, nobody has asked them to consent—for
nobody expects such an undertaking.

The overwhelming majority of our fellow citizens do not abandon in the
slightest their hope and their expectation that the United States will
not become involved in military participation in these wars.

I can also understand the wishfulness of those who oversimplify the
whole situation by repeating that all we have to do is to mind our own
business and keep the nation out of war. But there is a vast difference
between keeping out of war and pretending that this war is none of our
business.

We do not have to go to war with other nations, but at least we can
strive with other nations to encourage the kind of peace that will lighten
the troubles of the world, and by so doing help our own nation as well.

I ask that all of us everywhere think things through with the single
aim of how best to serve the future of our own nation. I do not mean merely
its future relationship with the outside world. I mean its domestic future
as well—the work, the security, the prosperity, the happiness, the life
of all the boys and girls in the United States, as they are inevitably
affected by such world relationships. For it becomes clearer and clearer
that the future world will be a shabby and dangerous place to live in-yes,
even for Americans to live in—if it is ruled by force in the hands of a
few.

Already the crash of swiftly moving events over the earth has made us
all think with a longer view. Fortunately, that thinking cannot be controlled
by partisanship. The time is long past when any political party or any
particular group can curry or capture public favor by labeling itself the
"peace party" or the "peace bloc." That label belongs to the whole United
States and to every right thinking man, woman and child within it.

For out of all the military and diplomatic turmoil, out of all the propaganda,
and counter-propaganda of the present conflicts, there are two facts which
stand out, and which the whole world acknowledges.

The first is that never before has the Government of the United States
of America done so much as in our recent past to establish and maintain
the policy of the Good Neighbor with its sister nations.

The second is that in almost every nation in the world today there is
a true public belief that the United States has been, and will continue
to be, a potent and active factor in seeking the reestablishment of world
peace.

In these recent years we have had a clean record of peace and good-will.
It is an open book that cannot be twisted or defamed. It is a record that
must be continued and enlarged.

So I hope that Americans everywhere will work out for themselves the
several alternatives which lie before world civilization, which necessarily
includes our own.

We must look ahead and see the possibilities for our children if the
rest of the world comes to be dominated by concentrated force alone—even
though today we are a very great and a very powerful nation.

We must look ahead and see the effect on our own future if all the small
nations of the world have their independence snatched from them or become
mere appendages to relatively vast and powerful military systems.

We must look ahead and see the kind of lives our children would have
to lead if a large part of the rest of the world were compelled to worship
a god imposed by a military ruler, or were forbidden to worship God at
all; if the rest of the world were forbidden to read and hear the facts—the
daily news of their own and other nations—if they were deprived of the
truth that makes men free.

We must look ahead and see the effect on our future generations if world
trade is controlled by any nation or group of nations 'which sets up that
control through military force.

It is, of course, true that the record of past centuries includes destruction
of many small nations, the enslavement of peoples, and the building of
empires on the foundation of force. But wholly apart from the greater international
morality which we seek today, we recognize the practical fact that with
modern weapons and modern conditions, modern man can no longer lead a civilized
life if we are to go back to the practice of wars and conquests of the
seventeenth and eighteenth centuries.

Summing up this need of looking ahead, and in words of common sense
and good American citizenship. I hope that we shall have fewer American
ostriches in our midst. It is not good for the ultimate health of ostriches
to bury their heads in the sand.

Only an ostrich would look upon these wars through the eyes of cynicism
or ridicule.

Of course, the peoples of other nations have the right to choose their
own form of Government. But we in this nation still believe that such choice
should be predicated on certain freedoms which we think are essential everywhere.
We know that we ourselves shall never be wholly safe at home unless other
governments recognize such freedoms.

Twenty-one American Republics, expressing the will of two hundred and
fifty million people to preserve peace and freedom in this Hemisphere,
are displaying a unanimity of ideals and practical relationships which
gives hope that what is being done here can be done on other continents.
We in all the Americas are coming to the realization that we can retain
our respective nationalities without, at the same time, threatening the
national existence of our neighbors.

Such truly friendly relationships, for example, permit us to follow
our own domestic policies with reference to our agricultural products,
while at the same time we have the privilege of trying to work out mutual
assistance arrangements for a world distribution of world agricultural
surpluses.

And we have been able to apply the same simple principle to many manufactured
products—surpluses of which must be sold in the world export markets if
we intend to continue a high level of production and employment.

For many years after the World War blind economic selfishness in most
countries, including our own, resulted in a destructive mine-field of trade
restrictions which blocked the channels of commerce among nations. Indeed,
this policy was one of the contributing causes of existing wars. It dammed
up vast unsalable surpluses, helping to bring about unemployment and suffering
in the United States and everywhere else.

To point the way to break up that log-jam our Trade Agreements Act was
passed-based upon a policy of equality of treatment among nations and of
mutually profitable arrangements of trade.

It is not correct to infer that legislative powers have been transferred
from the Congress to the Executive Branch of the Government. Everyone recognizes
that general tariff legislation is a Congressional function; but we know
that, because of the stupendous task involved in the fashioning and the
passing of a general tariff law, it is advisable to provide at times of
emergency some flexibility to make the general law adjustable to quickly
changing conditions.

We are in such a time today. Our present trade agreement method provides
a temporary flexibility and is, therefore, practical in the best sense.
It should be kept alive to serve our trade interests—agricultural and industrial—in
many valuable ways during the existing wars.

But what is more important, the Trade Agreements Act should be extended
as an indispensable part of the foundation of any stable and enduring peace.

The old conditions of world trade made for no enduring peace; and when
the time comes, the United States must use its influence to open up the
trade channels of the world, in all nations, in order that no one nation
need feel compelled in later days to seek by force of arms what it can
well gain by peaceful conference. For that purpose, too, we need the Trade
Agreements Act even more today than when it was passed.

I emphasize the leadership which this nation can take when the time
comes for a renewal of world peace. Such an influence will be greatly weakened
if this Government becomes a dog in the manger of trade selfishness.

The first President of the United States warned us against entangling
foreign alliances. The present President of the United States subscribes
to and follows that precept.

I hope that most of you will agree that trade cooperation with the rest
of the world does not violate that precept in any way.

Even as through these trade agreements we prepare to cooperate in a
world that wants peace, we must likewise be prepared to take care of ourselves
if the world cannot attain peace.

For several years past we have been compelled to strengthen our own
national defense. That has created a very large portion of our Treasury
deficits. This year in the light of continuing world uncertainty, I am
asking the Congress for Army and Navy increases which are based not on
panic but on common sense. They are not as great as enthusiastic alarmists
seek. They are not as small as unrealistic persons claiming superior private
information would demand.

As will appear in the annual budget tomorrow, the only important increase
in any part of the budget is the estimate for national defense. Practically
all other important items show a reduction. But you know, you can't eat
your cake and have it too. Therefore, in the hope that we can continue
in these days of increasing economic prosperity to reduce the Federal deficit,
I am asking the Congress to levy sufficient additional taxes to meet the
emergency spending for national defense.

Behind the Army and Navy, of course, lies our ultimate line of defense—"the
general welfare" of our people. We cannot report, despite all the progress
that we have made in our domestic problems—despite the fact that production
is back to 1929 levels—that all our problems are solved. The fact of unemployment
of millions of men and women remains a symptom of a number of difficulties
in our economic system not yet adjusted.

While the number of the unemployed has decreased very greatly, while
their immediate needs for food and clothing-as far as the Federal Government
is concerned—have been largely met, while their morale has been kept alive
by giving them useful public work, we have not yet found a way to employ
the surplus of our labor which the efficiency of our industrial processes
has created.

We refuse the European solution of using the unemployed to build up
excessive armaments which eventually result in dictatorships and war. We
encourage an American way—through an increase of national income which
is the only way we can be sure will take up the slack. Much progress has
been made; much remains to be done.

We recognize that we must find an answer in terms of work and opportunity.

The unemployment problem today has become very definitely a problem
of youth as well as of age. As each year has gone by hundreds of thousands
of boys and girls have come of working age. They now form an army of unused
youth. They must be an especial concern of democratic Government.

We must continue, above all things, to look for a solution of their
special problem. For they, looking ahead to life, are entitled to action
on our part and not merely to admonitions of optimism or lectures on economic
laws.

Some in our midst have sought to instill a feeling of fear and defeatism
in the minds of the American people about this problem.

To face the task of finding jobs faster than invention can take them
away—is not defeatism. To warble easy platitudes that if we would only
go back to ways that have failed, everything would be all right—is not
courage.

In 1933 we met a problem of real fear and real defeatism. We faced the
facts—with action and not with words alone.

The American people will reject the doctrine of fear, confident that
in the 'thirties we have been building soundly a new order of things, different
from the order of the 'twenties. In this dawn of the decade of the 'forties,
with our program of social improvement started, we will continue to carry
on the processes of recovery, so as to preserve our gains and provide jobs
at living wages.

There are, of course, many other items of great public interest which
could be enumerated in this message—the continued conservation of our natural
resources, the improvement of health and of education, the extension of
social security to larger groups, the freeing of large areas from restricted
transportation discriminations, the extension of the merit system and many
others.

Our continued progress in the social and economic field is important
not only for the significance of each part of it but for the total effect
which our program of domestic betterment has upon that most valuable asset
of a nation in dangerous times—its national unity.

The permanent security of America in the present crisis does not lie
in armed force alone. What we face is a set of world-wide forces of disintegration—vicious,
ruthless, destructive of all the moral, religious and political standards
which mankind, after centuries of struggle, has come to cherish most.

In these moral values, in these forces which have made our nation great,
we must actively and practically reassert our faith.

These words-"national unity"-must not be allowed to be come merely a
high-sounding phrase, a vague generality, a pious hope, to which everyone
can give lip-service. They must be made to have real meaning in terms of
the daily thoughts and acts of every man, woman and child in our land during
the coming year and during the years that lie ahead.

For national unity is, in a very real and a very deep sense, the fundamental
safeguard of all democracy.

Doctrines that set group against group, faith against faith, race against
race, class against class, fanning the fires of hatred in men too despondent,
too desperate to think for themselves, were used as rabble-rousing slogans
on which dictators could ride to power. And once in power they could saddle
their tyrannies on whole nations and on their weaker neighbors.

This is the danger to which we in America must begin to be more alert.
For the apologists for foreign aggressors, and equally those selfish and
partisan groups at home who wrap themselves in a false mantle of Americanism
to promote their own economic, financial or political advantage, are now
trying European tricks upon us, seeking to muddy the stream of our national
thinking, weakening us in the face of danger, by trying to set our own
people to fighting among themselves. Such tactics are what have helped
to plunge Europe into war. We must combat them, as we would the plague,
if American integrity and American security are to be preserved. We cannot
afford to face the future as a disunited people.

We must as a united people keep ablaze on this continent the flames
of human liberty, of reason, of democracy and of fair play as living things
to be preserved for the better world that is to come.

Overstatement, bitterness, vituperation, and the beating of drums have
contributed mightily to ill-feeling and wars between nations. If these
unnecessary and unpleasant actions are harmful in the international field,
if they have hurt in other parts of the world, they are also harmful in
the domestic scene. Peace among ourselves would seem to have some of the
advantage of peace between us and other nations. In the long run history
amply demonstrates that angry controversy surely wins less than calm discussion.

In the spirit, therefore, of a greater unselfishness, recognizing that
the world— including the United States of America— passes through perilous
times, I am very hopeful that the closing session of the Seventy-sixth
Congress will consider the needs of the nation and of humanity with calmness,
with tolerance and with cooperative wisdom.

May the year 1940 be pointed to by our children as another period when
democracy justified its existence as the best instrument of government
yet devised by mankind.